Petrobras and CADE agree on natural gas assets sale

Petrobras has signed an agreement with Brazil’s regulatory body Administrative Council for Economic Defense (CADE) regarding the sale of the company’s refining installations.

The deal aims to preserve and protect the competitive conditions, open the Brazilian natural gas market and suspend administrative procedures introduced by CADE to investigate Petrobras’ natural gas business.

As part of the agreement, Petrobras will sell a 10% stake in Nova Transportadora do Sudeste, 10% in Transportadora Associada de Gas and 51% in Transportadora Brasileira Gasoduto Bolivia-Brasil.

The company will also sell its indirect ownership in gas distribution companies, either by divesting its 51% stake in Gaspetro or its indirect ownership in distribution companies.

Petrobras noted that the divestments will be carried out following a schedule agreed upon by the parties, in line with the company’s divestment methodology, subject to economic and financial valuations related to each of the assets.

The asset divestment will be completed after the fulfilment of technical, legal, financial and compliance requirements from potential buyers.

In order to allow competitiveness in the natural gas market, the company proposes to negotiate access to outflow and processing assets and withhold from buying new gas volumes from its partners or third parties, except in certain situations listed in the agreement, and lease of the Regasification Terminal in Bahia.

The latest agreement is part of the company’s strategy to improve its capital allocation, reduce regulatory risks and consolidate its efforts with CADE to build a feasible environment for new investors entering the natural gas industry.

In June, the Brazilian Supreme Court has revoked an injunction that conditioned the sale of a number of major divestments by Petrobras.

In May, the Supreme Court suspended the sale of Petrobras’s TAG pipeline unit and eight refineries. The suspension also included the sale of its Araucaria Nitrogenous fertiliser business.